Key Takeaways
- FPCCI reports a 15.13% increase in Pakistan’s trade deficit for the first quarter of FY2026-27.
- The trade deficit widened to $10.792 billion in July-September 2026 from $9.374 billion in the same period last year.
- FPCCI urges the Ministry of Finance and State Bank of Pakistan to reduce interest rates and rationalize tariffs to support exports.
The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed concerns over the 15.13 percent increase in Pakistan’s trade deficit during the first quarter of the fiscal year 2026-27, warning that the widening gap could put pressure on the country’s foreign exchange reserves.
According to the latest data from the Pakistan Bureau of Statistics, the trade deficit increased to $10.792 billion during July-September 2026, up from $9.374 billion in the same period last year. In September alone, the trade deficit reached $3.55 billion, a 6.15 percent increase from $3.35 billion in September 2025.
FPCCI President Atif Ikram Sheikh attributed the widening trade gap to the high cost of doing business in Pakistan, which he said was hurting the competitiveness of local manufacturers against regional competitors. He cited high interest rates, electricity capacity charges, and petroleum levies as major barriers to industrial productivity and value addition.
Sheikh warned that continued reliance on imports to meet domestic demand could further pressure the national exchequer and create balance of payments risks if structural measures are not introduced. To support export targets and prevent industrial stagnation, the FPCCI has urged the Ministry of Finance and the State Bank of Pakistan to reduce the policy rate to single digits to provide manufacturers with more affordable working capital.
The FPCCI president also called for the immediate rationalization of electricity and gas tariffs to bring them closer to rates offered by regional competitors. He further called for targeted relief on inland logistics costs to reduce domestic supply chain expenses and improve the competitiveness of Pakistani manufacturers.
In response to these concerns, the FPCCI has called for a comprehensive review of the current economic policies to ensure that local industries remain competitive in the global market. The organization believes that by addressing these issues, Pakistan can mitigate the risks associated with the widening trade deficit and protect its foreign exchange reserves.
The FPCCI’s warnings come at a time when the country is already facing challenges in managing its foreign exchange reserves, with the need to balance domestic demand and international trade pressures. The organization’s recommendations are aimed at providing a roadmap for policymakers to address these challenges and support the growth of the manufacturing sector.
The trade deficit increased to $10.792 billion during July-September 2026 from $9.374 billion in the same period last year.
Atif Ikram Sheikh, FPCCI President
To support FY2026-27 export targets and prevent industrial stagnation, FPCCI has urged the Ministry of Finance and the State Bank of Pakistan to reduce the policy rate to single digits to provide manufacturers with more affordable working capital.
Atif Ikram Sheikh, FPCCI President
